EX-4.1
EMPLOYEE STOCK INCENTIVE PLAN
NEXT GENERATION MEDIA CORP
EMPLOYEE STOCK INCENTIVE PLAN
1. GENERAL PROVISIONS
1.1 Purpose.
The Stock Incentive Plan (the "Plan") is intended to allow designated
officers, employees and certain non-employees (all of whom are sometimes
collectively referred to herein as "Employees") Next Generation Media
Corp., a Nevada corporation ("NextGen") and its Subsidiaries (as that term
is defined below) which it may have from time to time (NextGen and such
Subsidiaries are referred to herein as the "Company") to receive certain
options ("Stock Options") to purchase NextGen common stock, one tenth of
one cent ($0.001) par value ("Common Stock"), and to receive grants of
Common Stock subject to certain restrictions ("Awards"). As used in this
Plan, the term "Subsidiary" shall mean each corporation which is a
"subsidiary corporation" of NextGen within the meaning of Section 424(f)
of the Internal Revenue Code of 1986, as amended (the "Code"). The
purpose of this Plan is to provide Employees with equity-based
compensation incentives to make significant and extraordinary
contributions to the long-term growth and performance of the Company, and
to attract and retain Employees.
1.2 Administration.
1.2.1 The Plan shall be administered by the Compensation Committee
(the "Committee") of, or appointed by, the Board of Directors of NextGen
(the "Board"). The Committee shall select one of its members as Chairman
and shall act by vote of a majority of a quorum, or by unanimous written
consent. A majority of its members shall constitute a quorum. The
Committee shall be governed by the provisions of NextGen Bylaws and of
Nevada law applicable to the Board, except as otherwise provided herein or
determined by the Board.
1.2.2 The Committee shall have full and complete authority, in its
discretion, but subject to the express provisions of the Plan: to approve
the Employees nominated by the management of the Company to be granted
Awards or Stock Options; to determine the number of Awards or Stock
Options to be granted to an Employee; to determine the time or times at
which Awards or Stock Options shall be granted; to establish the terms and
conditions upon which Awards or Stock Options may be exercised; to remove
or adjust any restrictions and conditions upon Awards or Stock Options; to
specify, at the time of grant, provisions relating to exercisability of
Stock Options and to accelerate or otherwise modify the exercisability of
any Stock Options; and to adopt such rules and regulations and to make all
other determinations deemed necessary or desirable for the administration
of the Plan. All interpretations and constructions of the Plan by the
Committee, and all of its actions hereunder, shall be binding and conclu-
sive on all persons for all purposes.
1.2.3 The Company hereby agrees to indemnify and hold harmless each
Committee member and each employee of the Company, and the estate and
heirs of such Committee member or employee, against all claims,
liabilities, expenses, penalties, damages or other pecuniary losses,
including legal fees, which such Committee member or employee, his or her
estate or heirs may suffer as a result of his or her responsibilities,
obligations or duties in connection with the Plan, to the extent that
insurance, if any, does not cover the payment of such items. No member of
the Committee or the Board shall be liable for any action or determination
made in good faith with respect to the Plan or any Award or Stock Option
granted pursuant to the Plan.
1.3 Eligibility and Participation.
Employees eligible under the Plan shall be approved by the Committee
from those Employees who, in the opinion of the management of the Company,
are in positions which enable them to make significant contributions to
the long-term performance and growth of the Company. In selecting
Employees to whom Stock Options or Awards may be granted, consideration
shall be given to factors such as employment position, duties and respon-
sibilities, ability, productivity, length of service, morale, interest in
the Company and recommendations of supervisors.
1.4 Shares Subject to the Plan.
The maximum number of shares of Common Stock that may be issued
pursuant to the Plan shall be Three Million (3,000,000) subject to
adjustment pursuant to the provisions of paragraph 4.1. If shares of
Common Stock awarded or issued under the Plan are reacquired by the
Company due to a forfeiture or for any other reason, such shares shall be
cancelled and thereafter shall again be available for purposes of the
Plan. If a Stock Option expires, terminates or is cancelled for any
reason without having been exercised in full, the shares of Common Stock
not purchased thereunder shall again be available for purposes of the Plan.
2. PROVISIONS RELATING TO STOCK OPTIONS
2.1 Grants of Stock Options.
The Committee may grant Stock Options in such amounts, at such times,
and to such Employees nominated by the management of the Company as the
Committee, in its discretion, may determine. Stock Options granted under
the Plan shall constitute "incentive stock options" within the meaning of
Section 422 of the Code, if so designated by the Committee on the date of
grant. The Committee shall also have the discretion to grant Stock
Options which do not constitute incentive stock options, and any such
Stock Options shall be designated non-statutory stock options by the
Committee on the date of grant. The aggregate fair market value (deter-
mined as of the time an incentive stock option is granted) of the Common
Stock with respect to which incentive stock options are exercisable for
the first time by any Employee during any one calendar year (under all
plans of the Company and any parent or subsidiary of the Company) may not
exceed the maximum amount permitted under Section 422 of the Code
(currently one hundred thousand dollars ($100,000.00)). Non-statutory
stock options shall not be subject to the limitations relating to incentive
stock options contained in the preceding sentence. Each Stock Option
shall be evidenced by a written agreement (the "Option Agreement") in a
form approved by the Committee, which shall be executed on behalf of the
Company and by the Employee to whom the Stock Option is granted, and which
shall be subject to the terms and conditions of this Plan. In the
discretion of the Committee, Stock Options may include provisions (which
need not be uniform), authorized by the Committee in its discretion, that
accelerate an Employee's rights to exercise Stock Options following a
"Change in Control," upon termination of such Employee employment by the
Company without "Cause" or by the Employee for "Good Reason," as such
terms are defined in paragraph 3.1 hereof. The holder of a Stock Option
shall not be entitled to the privileges of stock ownership as to any
shares of Common Stock not actually issued to such holder.
2.2 Purchase Price.
The purchase price ("Exercise Price") of shares of Common Stock
subject to each Stock Option ("Option Shares") shall be fifty percent
(50%) of the fair market value of the Common Stock on the date of
exercise. For an employee holding greater than ten percent (10%) of the
total voting power of all stock of the Company, either Common or
Preferred, the Exercise Price of an incentive stock option shall be at
least one hundred and ten percent (110%) of the fair market value of the
Common Stock on the date of the grant of the option.
2.3 Option Period.
The Stock Option period (the "Term") shall commence on the date of
grant of the Stock Option and shall be ten (10) years or such shorter
period as is determined by the Committee. Each Stock Option shall
provide that it is exercisable over its term in such periodic installments
as the Committee in its sole discretion may determine. Such provisions
need not be uniform. Section 16(b) of the Exchange Act exempts persons
normally subject to the reporting requirements of Section 16(a) of the
Exchange Act ("Section 16 Reporting Persons") pursuant to a qualified
employee stock option plan from the normal requirement of not selling
until at least six (6) months and one day from the date the Stock Option
is granted.
2.4 Exercise of Options.
2.4.1 Each Stock Option may be exercised in whole or in part (but not
as to fractional shares) by delivering it for surrender or endorsement to
the Company, attention of the Corporate Secretary, at the principal office
of the Company, together with payment of the Exercise Price and an
executed Notice and Agreement of Exercise in the form prescribed by
paragraph 2.4.2. Payment may be made (i) in cash, (ii) by cashier's or
certified check, (iii) by surrender of previously owned shares of the
Company's Common Stock valued pursuant to paragraph 2.2 (if the Committee
authorizes payment in stock in its discretion), (iv) by withholding from
the Option Shares which would otherwise be issuable upon the exercise of
the Stock Option that number of Option Shares equal to the exercise price
of the Stock Option, if such withholding is authorized by the Committee in
its discretion, or (v) in the discretion of the Committee, by the delivery
to the Company of the optionee's promissory note secured by the Option
Shares, bearing interest at a rate sufficient to prevent the imputation of
interest under Sections 483 or 1274 of the Code, and having such other
terms and conditions as may be satisfactory to the Committee.
2.4.2 Exercise of each Stock Option is conditioned upon the agreement
of the Employee to the terms and conditions of this Plan and of such Stock
Option as evidenced by the Employee's execution and delivery of a Notice
and Agreement of Exercise in a form to be determined by the Committee in
its discretion. Such Notice and Agreement of Exercise shall set forth the
agreement of the Employee that: (a) no Option Shares will be sold or
otherwise distributed in violation of the Securities Act of 1933 (the
"Securities Act") or any other applicable federal or state securities
laws, (b) each Option Share certificate may be imprinted with legends
reflecting any applicable federal and state securities law restrictions
and conditions, (c) the Company may comply with said securities law
restrictions and issue "stop transfer" instructions to its Transfer Agent
and Registrar without liability, (d) if the Employee is a Section 16
Reporting Person, the Employee will furnish to the Company a copy of each
Form 4 or Form 5 filed by said Employee and will timely file all reports
required under federal securities laws, and (e) the Employee will report
all sales of Option Shares to the Company in writing on a form prescribed
by the Company.
2.4.3 No Stock Option shall be exercisable unless and until any
applicable registration or qualification requirements of federal and state
securities laws, and all other legal requirements, have been fully
complied with. The Company will use reasonable efforts to maintain the
effectiveness of a Registration Statement under the Securities Act for the
issuance of Stock Options and shares acquired thereunder, but there may be
times when no such Registration Statement will be currently effective.
The exercise of Stock Options may be temporarily suspended without
liability to the Company during times when no such Registration Statement
is currently effective, or during times when, in the reasonable opinion of
the Committee, such suspension is necessary to preclude violation of any
requirements of applicable law or regulatory bodies having jurisdiction
over the Company. If any Stock Option would expire for any reason except
the end of its term during such a suspension, then if exercise of such
Stock Option is duly tendered before its expiration, such Stock Option
shall be exercisable and exercised (unless the attempted exercise is
withdrawn) as of the first day after the end of such suspension. The
Company shall have no obligation to file any Registration Statement
covering resales of Option Shares.
2.5 Continuous Employment.
Except as provided in paragraph 2.7 below, an Employee may not
exercise a Stock Option unless from the date of grant to the date of
exercise such Employee remains continuously in the employ of the Company.
For purposes of this paragraph 2.5, the period of continuous employment
of an Employee with the Company shall be deemed to include (without
extending the term of the Stock Option) any period during which such
Employee is on leave of absence with the consent of the Company, provided
that such leave of absence shall not exceed three (3) months and that such
Employee returns to the employ of the Company at the expiration of such
leave of absence. If such Employee fails to return to the employ of the
Company at the expiration of such leave of absence, such Employee's
employment with the Company shall be deemed terminated as of the date such
leave of absence commenced. The continuous employment of an Employee with
the Company shall also be deemed to include any period during which such
Employee is a member of the Armed Forces of the United States, provided
that such Employee returns to the employ of the Company within ninety (90)
days (or such longer period as may be prescribed by law) from the date
such Employee first becomes entitled to discharge. If an Employee does
not return to the employ of the Company within ninety (90) days (or such
longer period as may be prescribed by law) from the date such Employee
first becomes entitled to discharge, such Employee's employment with the
Company shall be deemed to have terminated as of the date such Employee's
military service ended.
2.6 Restrictions on Transfer.
Each Stock Option granted under this Plan shall be transferable only
by will or the laws of descent and distribution. No interest of any
Employee under the Plan shall be subject to attachment, execution,
garnishment, sequestration, the laws of bankruptcy or any other legal or
equitable process. Each Stock Option granted under this Plan shall be
exercisable during an Employee's lifetime only by such Employee or by such
Employee's legal representative.
2.7 Termination of Employment.
2.7.1 Upon an Employee's Retirement, Disability (both terms being
defined below) or death, (a) all Stock Options to the extent then
presently exercisable shall remain in full force and effect and may be
exercised pursuant to the provisions thereof, including expiration at the
end of the fixed term thereof, and (b) unless otherwise provided by the
Committee, all Stock Options to the extent not then presently exercisable
by such Employee shall terminate as of the date of such termination of
employment and shall not be exercisable thereafter.
2.7.2 Upon the termination of the employment of an Employee with the
Company for any reason other than the reasons set forth in paragraph 2.7.1
hereof, (a) all Stock Options to the extent then presently exercisable by
such Employee shall remain exercisable only for a period of ninety (90)
days after the date of such termination of employment (except that the
ninety (90) day period shall be extended to twelve (12) months if the
Employee shall die during such ninety (90) day period), and may be
exercised pursuant to the provisions thereof, including expiration at the
end of the fixed term thereof, and (b) unless otherwise provided by the
Committee, all Stock Options to the extent not then presently exercisable
by such Employee shall terminate as of the date of such termination of
employment and shall not be exercisable thereafter.
2.7.3 For purposes of this Plan:
(a) "Retirement" shall mean an Employee's retirement from the employ
of the Company on or after the date on which such Employee attains the age
of sixty-five (65) years; and
(b) "Disability" shall mean total and permanent incapacity of an
Employee, due to physical impairment or legally established mental
incompetence, to perform the usual duties of such Employee's employment
with the Company, which disability shall be determined: (i) on medical
evidence by a licensed physician designated by the Committee, or (ii) on
evidence that the Employee has become entitled to receive primary benefits
as a disabled employee under the Social Security Act in effect on the date
of such disability.
3. PROVISIONS RELATING TO AWARDS
3.1 Grant of Awards.
Subject to the provisions of the Plan, the Committee shall have full
and complete authority, in its discretion, but subject to the express
provisions of this Plan, to (i) grant Awards pursuant to the Plan, (ii)
determine the number of shares of Common Stock subject to each Award
("Award Shares"), (iii) determine the terms and conditions (which need not
be identical) of each Award, including the consideration (if any) to be
paid by the Employee for such Common Stock, which may, in the Committee's
discretion, consist of the delivery of the Employee's promissory note
meeting the requirements of paragraph 2.4.1, (iv) establish and modify
performance criteria for Awards, and (v) make all of the determinations
necessary or advisable with respect to Awards under the Plan. Each award
under the Plan shall consist of a grant of shares of Common Stock subject
to a restriction period (after which the restrictions shall lapse), which
shall be a period commencing on the date the award is granted and ending
on such date as the Committee shall determine (the "Restriction Period").
The Committee may provide for the lapse of restrictions in installments,
for acceleration of the lapse of restrictions upon the satisfaction of
such performance or other criteria or upon the occurrence of such events
as the Committee shall determine, and for the early expiration of the
Restriction Period upon an Employee's death, Disability or Retirement as
defined in paragraph 2.7.3, or, following a Change of Control, upon
termination of an Employee's employment by the Company without "Cause" or
by the Employee for "Good Reason," as those terms are defined herein. For
purposes of this Plan:
"Change of Control" shall be deemed to occur (a) on the date the
Company first has actual knowledge that any person (as such term is used
in Sections 13(d) and 14(d) (2) of the Exchange Act) has become the
beneficial owner (as defined in Rule 13(d)-3 under the Exchange Act),
directly or indirectly, of securities of the Company representing forty
percent (40%) or more of the combined voting power of the Company's then
outstanding securities, or (b) on the date the shareholders of the Company
approve (i) a merger of the Company with or into any other corporation in
which the Company is not the surviving corporation or in which the Company
survives as a subsidiary of another corporation, (ii) a consolidation of
the Company with any other corporation, or (iii) the sale or disposition
of all or substantially all of the Company's assets or a plan of complete
liquidation.
"Cause," when used with reference to termination of the employment of
an Employee by the Company for "Cause," shall mean:
(a) the Employee's continuing willful and material breach of his or
her duties to the Company after he or she receives a demand from the Chief
Executive of the Company specifying the manner in which he or she has
willfully and materially breached such duties, other than any such failure
resulting from Disability of the Employee or his or her resignation for
"Good Reason," as defined herein; or
(b) the conviction of the Employee of a felony; or
(c) the Employee's commission of fraud in the course of his or her
employment with the Company, such as embezzlement or other material and
intentional violation of law against the Company; or
(d) the Employee's gross misconduct causing material harm to the
Company.
"Good Reason" shall mean any one or more of the following, occurring
following or in connection with a Change of Control and within ninety (90)
days prior to the Employee's resignation, unless the Employee shall have
consented thereto in writing:
(a) the assignment to the Employee of duties inconsistent with his
or her executive status prior to the Change of Control or a substantive
change in the officer or officers to whom he or she reports from the
officer or officers to whom he or she reported immediately prior to the
Change of Control; or
(b) the elimination or reassignment of a majority of the duties and
responsibilities that were assigned to the Employee immediately prior to
the Change of Control; or
(c) a reduction by the Company in the Employee's annual base salary
as in effect immediately prior to the Change of Control; or
(d) the Company's requiring the Employee to be based anywhere
outside a 35-mile radius from his or her place of employment immediately
prior to the Change of Control, except for required travel on the
Company's business to an extent substantially consistent with the
Employee's business travel obligations immediately prior to the Change of
Control; or
(e) the failure of the Company to grant the Employee a performance
bonus reasonably equivalent to the same percentage of salary the Employee
normally received prior to the Change of Control, given comparable
performance by the Company and the Employee; or
(f) the failure of the Company to obtain a satisfactory Assumption
Agreement (as defined in paragraph 4.12 of the Plan) from a successor, or
the failure of such successor to perform such Assumption Agreement.
3.2 Incentive Agreements.
Each Award granted under the Plan shall be evidenced by a written
agreement (an "Incentive Agreement") in a form approved by the Committee
and executed by the Company and the Employee to whom the Award is granted.
Each Incentive Agreement shall be subject to the terms and conditions of
the Plan and other such terms and conditions as the Committee may specify.
3.3 Waiver of Restrictions.
The Committee may modify or amend any Award under the Plan or waive
any restrictions or conditions applicable to such Awards; provided,
however, that the Committee may not undertake any such modifications,
amendments or waivers if the effect thereof materially increases the
benefits to any Employee, or adversely affects the rights of any Employee
without his or her consent.
3.4 Terms and Conditions of Awards.
3.4.1 Upon receipt of an Award of shares of Common Stock under the
Plan, even during the Restriction Period, an Employee shall be the holder
of record of the shares and shall have all the rights of a shareholder
with respect to such shares, subject to the terms and conditions of the
Plan and the Award.
3.4.2 Except as otherwise provided in this paragraph 3.4, no shares of
Common Stock received pursuant to the Plan shall be sold, exchanged,
transferred, pledged, hypothecated or otherwise disposed of during the
Restriction Period applicable to such shares. Any purported disposition
of such Common Stock in violation of this paragraph 3.4.2 shall be null
and void.
3.4.3 If an Employee's employment with the Company terminates prior to
the expiration of the Restriction Period for an Award, subject to any
provisions of the Award with respect to the Employee's death, Disability
or Retirement, or Change of Control, all shares of Common Stock subject to
the Award shall be immediately forfeited by the Employee and reacquired by
the Company, and the Employee shall have no further rights with respect to
the Award. In the discretion of the Committee, an Incentive Agreement may
provide that, upon the forfeiture by an Employee of Award Shares, the
Company shall repay to the Employee the consideration (if any) which the
Employee paid for the Award Shares on the grant of the Award. In the
discretion of the Committee, an Incentive Agreement may also provide that
such repayment shall include an interest factor on such consideration from
the date of the grant of the Award to the date of such repayment.
3.4.4 The Committee may require under such terms and conditions as it
deems appropriate or desirable that (i) the certificates for Common Stock
delivered under the Plan are to be held in custody by the Company or a
person or institution designated by the Company until the Restriction
Period expires, (ii) such certificates shall bear a legend referring to
the restrictions on the Common Stock pursuant to the Plan, and (iii) the
Employee shall have delivered to the Company a stock power endorsed in
blank relating to the Common Stock.
4. MISCELLANEOUS PROVISIONS
4.1 Adjustments Upon Change in Capitalization.
4.1.1 The number and class of shares subject to each outstanding Stock
Option, the Exercise Price thereof (but not the total price), the maximum
number of Stock Options that may be granted under the Plan, the minimum
number of shares as to which a Stock Option may be exercised at any one
time, and the number and class of shares subject to each outstanding
Award, shall be proportionately adjusted in the event of any increase or
decrease in the number of the issued shares of Common Stock which results
from a split-up or consolidation of shares, payment of a stock dividend or
dividends exceeding a total of five percent (5%) for which the record
dates occur in any one fiscal year, a recapitalization (other than the
conversion of convertible securities according to their terms), a
combination of shares or other like capital adjustment, so that (i) upon
exercise of the Stock Option, the Employee shall receive the number and
class of shares such Employee would have received had such Employee been
the holder of the number of shares of Common Stock for which the Stock
Option is being exercised upon the date of such change or increase or
decrease in the number of issued shares of the Company, and (ii) upon the
lapse of restrictions of the Award Shares, the Employee shall receive the
number and class of shares such Employee would have received if the
restrictions on the Award Shares had lapsed on the date of such change or
increase or decrease in the number of issued shares of the Company.
4.1.2 Upon a reorganization, merger or consolidation of the Company
with one or more corporations as a result of which NextGen is not the
surviving corporation or in which NextGen survives as a wholly-owned
subsidiary of another corporation, or upon a sale of all or substantially
all of the property of the Company to another corporation, or any dividend
or distribution to shareholders of more than ten percent (10%) of the
Company's assets, adequate adjustment or other provisions shall be made by
the Company or other party to such transaction so that there shall remain
and/or be substituted for the Option Shares and Award Shares provided for
herein, the shares, securities or assets which would have been issuable or
payable in respect of or in exchange for such Option Shares and Award
Shares then remaining, as if the Employee had been the owner of such
shares as of the applicable date. Any securities so substituted shall be
subject to similar successive adjustments.
4.2 Withholding Taxes.
The Company shall have the right at the time of exercise of any Stock
Option, the grant of an Award, or the lapse of restrictions on Award
Shares, to make adequate provision for any federal, state, local or
foreign taxes which it believes are or may be required by law to be
withheld with respect to such exercise ("Tax Liability"), to ensure the
payment of any such Tax Liability. The Company may provide for the
payment of any Tax Liability by any of the following means or a
combination of such means, as determined by the Committee in its sole and
absolute discretion in the particular case: (i) by requiring the Employee
to tender a cash payment to the Company, (ii) by withholding from the
Employee's salary, (iii) by withholding from the Option Shares which would
otherwise be issuable upon exercise of the Stock Option, or from the Award
Shares on their grant or date of lapse of restrictions, that number of
Option Shares or Award Shares having an aggregate fair market value
(determined in the manner prescribed by paragraph 2.2) as of the date the
withholding tax obligation arises in an amount which is equal to the
Employee's Tax Liability or (iv) by any other method deemed appropriate by
the Committee. Satisfaction of the Tax Liability of a Section 16
Reporting Person may be made by the method of payment specified in clause
(iii) above only if the following two conditions are satisfied:
(a) the withholding of Option Shares or Award Shares and the
exercise of the related Stock Option occur at least six months and one day
following the date of grant of such Stock Option or Award; and
(b) the withholding of Option Shares or Award Shares is made either
(i) pursuant to an irrevocable election ("Withholding Election") made by
such Employee at least six months in advance of the withholding of Options
Shares or Award Shares, or (ii) on a day within a ten-day "window period"
beginning on the third business day following the date of release of the
Company's quarterly or annual summary statement of sales and earnings.
Anything herein to the contrary notwithstanding, a Withholding Election
may be disapproved by the Committee at any time.
4.3 Relationship to Other Employee Benefit Plans.
Stock Options and Awards granted hereunder shall not be deemed to be
salary or other compensation to any Employee for purposes of any pension,
thrift, profit-sharing, stock purchase or any other employee benefit plan
now maintained or hereafter adopted by the Company.
4.4 Amendments and Termination.
The Board of Directors may at any time suspend, amend or terminate
this Plan. No amendment, except as provided in paragraph 2.8, or
modification of this Plan may be adopted, except subject to stockholder
approval, which would: (a) materially increase the benefits accruing to
Employees under this Plan, (b) materially increase the number of
securities which may be issued under this Plan (except for adjustments
pursuant to paragraph 4.1 hereof), or (c) materially modify the
requirements as to eligibility for participation in the Plan.
4.5 Successors in Interest.
The provisions of this Plan and the actions of the Committee shall be
binding upon all heirs, successors and assigns of the Company and of
Employees.
4.6 Other Documents.
All documents prepared, executed or delivered in connection with this
Plan (including, without limitation, Option Agreements and Incentive
Agreements) shall be, in substance and form, as established and modified
by the Committee; provided, however, that all such documents shall be
subject in every respect to the provisions of this Plan, and in the event
of any conflict between the terms of any such document and this Plan, the
provisions of this Plan shall prevail.
4.7 No Obligation to Continue Employment.
This Plan and grants hereunder shall not impose any obligation on the
Company to continue to employ any Employee. Moreover, no provision of
this Plan or any document executed or delivered pursuant to this Plan
shall be deemed modified in any way by any employment contract between an
Employee (or other employee) and the Company.
4.8 Misconduct of an Employee.
Notwithstanding any other provision of this Plan, if an Employee
commits fraud or dishonesty toward the Company or wrongfully uses or
discloses any trade secret, confidential data or other information
proprietary to the Company, or intentionally takes any other action
materially inimical to the best interests of the Company, as determined by
the Committee, in its sole and absolute discretion, such Employee shall
forfeit all rights and benefits under this Plan.
4.9 Term of Plan.
This Plan was adopted by the Board effective December 26, 2001. No
Stock Options or Awards may be granted under this Plan after December 26,
2011.
4.10 Governing Law.
This Plan shall be construed in accordance with, and governed by, the
laws of the State of Nevada.
4.11 Approval.
No Stock Option shall be exercisable, or Award granted, unless and
until the Directors of the Company have approved this Plan and all other
legal requirements have been fully complied with.
4.12 Assumption Agreements.
The Company will require each successor, (direct or indirect, whether
by purchase, merger, consolidation or otherwise), to all or substantially
all of the business or assets of the Company, prior to the consummation of
each such transaction, to assume and agree to perform the terms and
provisions remaining to be performed by the Company under each Incentive
Agreement and Stock Option and to preserve the benefits to the Employees
thereunder. Such assumption and agreement shall be set forth in a written
agreement in form and substance satisfactory to the Committee (an
"Assumption Agreement"), and shall include such adjustments, if any, in
the application of the provisions of the Incentive Agreements and Stock
Options and such additional provisions, if any, as the Committee shall
require and approve, in order to preserve such benefits to the Employees.
Without limiting the generality of the foregoing, the Committee may
require an Assumption Agreement to include satisfactory undertakings by a
successor:
(a) to provide liquidity to the Employees at the end of the
Restriction Period applicable to Common Stock awarded to them under the
Plan, or on the exercise of Stock Options;
(b) if the succession occurs before the expiration of any period
specified in the Incentive Agreements for satisfaction of performance
criteria applicable to the Common Stock awarded thereunder, to refrain
from interfering with the Company's ability to satisfy such performance
criteria or to agree to modify such performance criteria and/or waive any
criteria that cannot be satisfied as a result of the succession;
(c) to require any future successor to enter into an Assumption
Agreement; and
(d) to take or refrain from taking such other actions as the
Committee may require and approve, in its discretion.
The Committee referred to in this paragraph 4.12 is the Committee
appointed by a Board of Directors in office prior to the succession then
under consideration.
4.13 Compliance With Rule 16b-3.
Transactions under the Plan are intended to comply with all
applicable conditions of Rule 16b-3. To the extent that any provision of
the Plan or action by the Committee fails to so comply, it shall be deemed
null and void, to the extent permitted by law and deemed advisable by the
Committee.
IN WITNESS WHEREOF, this Plan has been executed effective as of the
26th day of December, 2001.
Next Generation Media Corp.
By: /s/ Darryl Reed
Darryl Reed
Chief Executive Officer